Penske Automotive looking for new acquisitions

Penske Automotive Group Inc. CEO Roger Penske recently told analysts that the company is being "opportunistic" about adding franchises but maintaining "strict financial discipline."

The nation’s second biggest auto retailer is open to acquisitions, but it's unlikely to return to its rapid pace of 2007 when it added $1.5 billion in revenues through store purchases. Fourth-quarter 2010 profit rose 53 percent, with higher sales of luxury vehicles offsetting losses at the Smart microcar brand.

Its net income rose to $28.5 million from $18.7 million a year earlier, and its fourth-quarter revenue rose 13 percent to $2.77 billion. In 2010, the company acquired eight franchises and opened 16 new points awarded by manufacturers.

The extra 24 franchises are forecasted to generate about $400 million in annual revenue. Penske said he could not guarantee that the company would match 2010’s revenue growth through purchases and new dealerships in 2011.

In 2010, Penske Automotive expended $80.9 million on capital expenditures - $60.4 million in the United States and $20.5 million worldwide. The company expects to spend about $100 million in 2011, split evenly between the American and international operations. [via autonews - sub. required]